Published on 4/7/2020 in the Prospect News Investment Grade Daily.
New Issue: Keurig Dr Pepper sells $1.5 billion of senior notes due 2030, 2050
By Cristal Cody
Tupelo, Miss., April 7 – Keurig Dr Pepper Inc. priced $1.5 billion of senior notes (Baa2/BBB) in two tranches on Tuesday, according to a market source and an FWP filed with the Securities and Exchange Commission.
A $750 million offering of 3.2% 10-year notes priced at 99.743 to yield 3.23% and a spread of 250 basis points over Treasuries.
The company sold $750 million of 3.8% 30-year notes at 99.448 to yield 3.831%, or with a Treasuries plus 250 bps spread.
Both tranches were talked to print with a spread in the Treasuries plus 300 bps area.
BofA Securities, Inc., Goldman Sachs & Co. LLC, J.P. Morgan Securities LLC, BNP Paribas Securities Corp., Mizuho Securities USA LLC, Morgan Stanley & Co. LLC, SMBC Nikko Securities America, Inc. and SunTrust Robinson Humphrey, Inc. were the bookrunners.
The notes are guaranteed by the issuer’s existing and future subsidiaries that guaranteed any of its other debt.
Proceeds will be used to repay borrowings under a 2018 credit facility and to repay commercial paper.
The beverage conglomerate is based in Burlington, Mass.
| Issuer: | Keurig Dr Pepper Inc.
|
| Guarantors: | Existing and future subsidiaries that guarantee company’s debt
|
| Amount: | $1.5 billion
|
| Description: | Senior notes
|
| Bookrunners: | BofA Securities, Inc., Goldman Sachs & Co. LLC, J.P. Morgan Securities LLC, BNP Paribas Securities Corp., Mizuho Securities USA LLC, Morgan Stanley & Co. LLC, SMBC Nikko Securities America, Inc. and SunTrust Robinson Humphrey, Inc.
|
| Co-managers: | ABN Amro Securities (USA) LLC, ICBC Standard Bank plc, Rabo Securities USA, Inc., TD Securities (USA) LLC and U.S. Bancorp Investments, Inc.
|
| Trade date: | April 7
|
| Settlement date: | April 13
|
| Ratings: | Moody’s: Baa2
|
| S&P: BBB
|
| Distribution: | SEC registered
|
|
|
| 10-year notes
|
| Amount: | $750 million
|
| Maturity: | May 1, 2030
|
| Coupon: | 3.2%
|
| Price: | 99.743
|
| Yield: | 3.23%
|
| Spread: | Treasuries plus 250 bps
|
| Call features: | Make-whole call before Feb. 1, 2030 at Treasuries plus 40 bps; thereafter at par
|
| Price guidance: | Treasuries plus 300 bps area
|
|
|
| 30-year notes
|
| Amount: | $750 million
|
| Maturity: | May 1, 2050
|
| Coupon: | 3.8%
|
| Price: | 99.448
|
| Yield: | 3.831%
|
| Spread: | Treasuries plus 250 bps
|
| Call features: | Make-whole call before Nov. 1, 2049 at Treasuries plus 40 bps; thereafter at par
|
| Price guidance: | Treasuries plus 300 bps area
|
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